If you locked a mortgage below 5 percent, that rate is one of the most valuable financial assets you own, and one of the two standard ways to tap home equity quietly destroys it. A cash-out refinance does not price just the money you need; it reprices everything you owe. The whole HELOC-versus-refi decision usually collapses into whether protecting the lock is worth paying more for the new money.
What does a cash-out refinance really reprice?
All of it. Owe $250,000 at 4.5 percent and need $50,000, and a cash-out refi writes one new loan near $300,000 at today’s rate, roughly 6.9 percent as of mid-2026 per Bankrate. The HELOC vs cash-out calculator isolates what that repricing alone costs: about $175,866 of extra interest at its defaults, before the new $50,000 has cost you a dollar. Most of the refinance’s total is your old, cheap debt wearing an expensive new rate for a fresh 30 years.
The HELOC takes the opposite trade: the $50,000 prices high, about 7.5 percent on current averages, and variable, but the $250,000 stays locked at 4.5 percent on your original schedule.
The five-second test: your blended rate
Multiply each balance by its rate and divide by the total. The default scenario blends to exactly 5 percent: (250,000 x 4.5 + 50,000 x 7.5) / 300,000. Hold that against the refi quote. A 6.9 percent refinance charges nearly two points more on every dollar you owe, so it loses before closing costs even enter. Flip the history, a mortgage locked at 8 percent with refi rates at 5.5, and the same arithmetic sends you straight to the refinance, which is exactly how the calculator’s verdict flips.
The blend is a screening tool, not the whole answer. Terms, closing costs, and how long you will keep the house move the totals, which is what the full comparison computes.
Why the refi payment looks cheaper anyway
The default scenario’s refi payment is $2,035 against $1,792 for mortgage plus HELOC, and that comparison flatters nobody so much as the more expensive loan. The refi restarts a 30-year clock; the keep option finishes your remaining 25 and retires the HELOC in 20. Lower payment, more months, more interest: the refi’s total runs about $432,631 against $214,045.
Payment still matters if the budget is tight this year. Just name what the lower payment is: a liquidity choice with a six-figure price tag, not a savings.
The honest caveats on the HELOC side
The calculator holds the HELOC rate flat, and reality will not. HELOCs price as an index plus a margin, per the CFPB, so every Fed move passes through to your payment. Most open with a roughly 10-year draw period where the minimum payment is interest-only, which feels cheap and retires nothing, and the CFPB flags the payment jump when repayment begins. Intro teaser rates expire in months. Run the numbers at the post-intro rate with a level repayment, the way the calculator models it, and if the HELOC only works at its teaser, let it go.
Fees run opposite: refis cost 2 to 6 percent of the new loan (often financed, so they accrue interest for decades), while HELOCs are frequently free to open but charge $50 to $250 a year.
How to decide in one sitting
Compute your blended rate. If the refi rate is above it, price the HELOC path seriously and guard the lock; if below, run the refinance numbers including its break-even on closing costs. Then stress the HELOC at two points above today’s rate, since variable means variable, and check the payment still fits. The HELOC calculator sizes what a lender will extend against your equity, and the cash-out refinance calculator details that path alone.
Try the calculator HELOC vs Cash-Out Refinance CalculatorCompare borrowing against your home two ways: keep your mortgage and add a HELOC, or refinance everything at today's rate, with the repricing cost in the open.The next step is five minutes: your balance, your rate, your years left, and the amount you need, into the comparator. The repricing-cost line will tell you immediately whether this is a close call or a settled one.